Earlier this month, the European Central Bank (ECB) published a report paper The authors claim that the existence of Bitcoin could lead to the impoverishment of non-holders and laggards.
Specifically, they wrote:
“Since Bitcoin does not increase the productive potential of the economy, the consequences of the supposed continuous increase in value are essentially redistributive, that is, the effects of wealth on the consumption of early Bitcoin holders can only come at the expense of the consumption of the rest of society.”
This has angered many Bitcoiners, including Frank in his article…but isn’t this essentially what Bitcoin hyperbole is? If Bitcoin becomes the world’s money, HODLers will become The new wealthy elite Whereas the paper bag holders would literally go bankrupt, wouldn’t they?
I think the real gist lies in the first part of the quote. Many Bitcoin users, myself included, believe that Bitcoin is in fact… He was Increasing the productive potential of the economy. (There are several reasons for this, but the main one is to eliminate the Cantillon effect of fiat currency, which greatly benefits governments.)
If in 2009 it had been possible to swap all the world’s fiat currencies for Bitcoin so that everyone got a representative share (and thus no redistribution effects), that might have been better…but economists at the ECB would have done that. Still Be against it: They don’t see the benefit of Bitcoin in the first place.
Since Satoshi Nakamoto had no way to swap everyone’s fiat currencies for Bitcoin even if he wanted to, it makes sense that he launched the project the way he did, allowing anyone to adopt these superior funds when it suited their individual appetite for risk.
If economists at the ECB think there is a better way to distribute this new form of money, I suggest they use their Cantillon-funded salaries to write a paper about Which.
This article is a takes. The opinions expressed are entirely those of the author and do not necessarily reflect the opinions of BTC Inc or Bitcoin Magazine.
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